The Rise and Fall of Social Media Platforms

Turn the sound off and drop the speed, and watch as the companies bounce up and then disappear.

In 2003 everyone was on Friendster, and back then “everyone” meant 3,5 million people. Their membership peaked at around 50 million, but by then Facebook had 120 million members. The company is “on a break“, and has been since 2005.

By 2005 everyone was on MySpace, but they were overtaken by YouTube in 2007 and had a peak user number of about 73 million in 2008 by which time Facebook had also overtaken them. MySpace still exists, and has tried to position itself as a platform for artists, it still has 50 million monthly active users.

By 2011 Facebook had overtaken and has remained in the top position ever since.

It’s interesting to see how the companies go up and down the charts, but I’m not sure exactly what it tells us – I think a social media platform can be financially successful serving a smaller audience. Linkedin no longer ranks in the tables, and it was purchased by Microsoft in 2016, but it’s a revenue generator for them because of it’s bespoke business tools, and the high level of influence the members have in the business world. The biggest option might not always suit your purpose. Making a profitable business out of a social media channel needs to be about more than ad revenue.

This was compiled by TNV, and they’ve sort of explained how they did it in an article, nowhere on the graphic or the article does it say what the measure is, it seems to be monthly active users (I compared published data from Weibo and Facebook), but I suspect that the Google Buzz figure is not accurate – it plateaus at 170 million, and then is overtaken by other platforms.

Their conclusion was

One thing’s for certain, judging by how many times the top spot changed hands over the past 16 years, none of the social media giants should be resting on their laurels. Really, anything can happen.

Not really. Only three companies held the top spot in the first 8 years; Friendster, MySpace and YouTube. In the last 8 years the top spot has been held by Facebook, and I expect it will take the top spot again this year. Given that “everybody” is now on Facebook it enjoys a position of being an entrenched network, the more people are on it the less likely people are to leave – even if some of us are reluctant users.

If a challenger comes for the top spot I suspect it will be from China, Sina Weibo sits in 7th spot on the 2018 data. They started out as a Chinese only, but now produce a site in both traditional and simplified Chinese to capture much of the Chinese diaspora, and have started to support other languages. Tencent has a billion users already, but is China only so was not included in the data.

Meanwhile I suspect that groups disillusioned with Facebook’s privacy and data practices will start smaller interest-based sites. I’m curious to see where this goes.

YouTube and Fraud; they don’t care.

Right now there is a video hosted on YouTube that is part of a real estate scam.

How do I know this? Because the real estate scam uses my company’s name, and someone emailed me a complaint.

The scam works by posting an advertisement online offering an apartment in a great location at a low rental rate. If you respond you are asked to send two or three months rent/bond and promised the keys once the money is received. Of course the apartment doesn’t exist, and you will never see the keys. Or your money for that matter.

So I tried to alert YouTube to this legal problem, but because my company’s name does not appear in the video I alerted them to a scam. I sent my email in English. For some reason I got two responses in Dutch. Fine. I responded to one explaining that the video was part of a fraud, and attaching the original complaint email.

I got another answer in Dutch, telling me that YouTube has developed a number of channels where I can report an issue with a video. The option most closely matching my question is “For other potential abuse or security issues please visit our Abuse and Safety Center”

So I click on that option, which takes me to a set of country links… but only five countries. Which is weird, but the underlying information is about what spam/phishing are, than any tool to allow me to report an issue.

Report Spam and Phishing in US, Canada, UK, Australia and New Zealand

So I’ve tried twice to alert YouTube to a video that is part of a fraud, but it does not appear that a real person has read the emails or certainly no action has been taken. Meanwhile the video has got another two hundred views.

Of course I am taking responsibility for resolving this because there is a reputational issue for my company, but how can I get YouTube to take responsibility for what is also a reputational issue for them?

And for the 900+ viewers of the video, how many of them will lose money before YouTube wakes up and takes action?

post script one week later; video still there with 1322 views

post script one month later; video still there with 1705 views

post script June 2013; video still there with 1948 views, reporting system improved and incident reported once again.

post script September 2013; video still there with 2499 views, reporting system improved and incident reported once again. YouTube say 24 hour review. I’ve been trying this for almost a year.

YouTube Video Sends Share Price Falling

It’s a much reported story, Dave Carroll flew United, put his guitar into the luggage, the guitar was damaged, and United were unwilling to compensate him for his loss. He tells the story much better in song on YouTube – here, in case you’re not one of the four million people who have already seen it.

Various reports point to a dive in United’s share price, which in these times no-one wants to see, and it’s often quoted as being a 10% drop. Well last year we saw the stock price financial services firms drop more than that in an afternoon, but still – it is not something any company wants to happen.

Much is being made of the transformative nature of consumer power due to social media, and while that has had an effect I’m not sure that it’s as great as some are saying.

In this diagram (and data is from wikiinvest) the arrow points to the date Dave Carroll launched his song “United Breaks Guitars” on YouTube. What you can see on the graph is that

  • the share price recovers quite quickly, surpassing it’s 6 July level by 15 July
  • the share price drops from 3.34 on 6 June to 3.18 on 9 June

Various commentators have talked about a 10% drop, but looking at day closing figures the drop is less than 5%.

Almost every article I’ve seen takes the angle that big companies better watch out because now everyone can put up their protest on YouTube and this will affect your share price.

I don’t think so.

Dave Carroll has talent, he’s an award-winning musician, he has the ability and resources to create an amusing video – and humour is a key component in a video going viral. An earlier video complaining about United has collected 112,000 views since being loaded to YouTube in April 2008 – and I suspect many of those views are recent since it’s now a related video to the Dave Carrol video (16 of the 40 pages of comments are from the last two weeks).

I don’t think all of us have the power to do what Dave Carroll did. That does not mean that companies should ignore social media, it’s pretty hard to imagine how Dave Carroll could have got an audience of 4M to a music video so quickly before YouTube. Even the old post it on a website and forward the email link would have been a lot slower – and before email? You would have needed to get it onto TV.

So social media makes a difference in the delivery channel, and the Dave Carroll story shows that United Airlines – the big company – had plenty of opportunity to get things right.

  • train your baggage handlers, reward them as a group for safe transfer of fragile baggage
  • give your first line staff the power to resolve a complaint for a customer
  • make solving customer complaints a first priority for your managers
  • when something does go wrong, rise above it, get your executives involved in a really great response.

Imagine if Glen Tilton, CEO of United Airlines, had given Dave Carroll a replacement guitar – with a tiny “sponsored by United Airlines” logo in it. They would have had a PR win on their hands, not a share prices dip.

 

Post Script:
Someone was smart enough to make a PR moment out of it. Bob Taylor CEO of Taylor Guitars created a video to help all guitarists about travelling with guitars.

 

Image guitar via pixabay

 

YouTube Money Worries

Views of Susan Boyle’s performance on the show “Britain’s Got Talent” topped 50,000,000 on YouTube this week (view video). The hype around her performance has been good for the show generally, other acts are heading for high millions in viewing numbers as well.

It sounds like Youtube is a fantastic success, a powerful new vehicle in popular culture, proof that social media works.

CM200904_moneyExcept for one thing, it’s losing money, in the order of 470 Million in 2009. While revenue from advertising has grown, and is predicted to grow further, costs are still high and growing – with more than 50% of the cost base of YouTube being bandwidth. So it’s somewhat a victim of it’s own success.

Few videos get enough visitors to generate significant revenue – videos I’ve posted have rocketed up to a mere 300 views for example, and although there is some money from branded channels (costs reported to be around 30K) the business model is pretty weak on revenue generation.

So what could YouTube do? The most obvious is to charge subscription, but Wikinomics states that Google will avoid this if at all possible. And suggests that they will invent their way out of it – finding a solution to the bandwidth problem, or accept it as a loss leader (for now), or start working on other revenue streams – and point to a fee-based download option.

Also this week Yahoo announced the end of GeoCities, current sites will be continued but you can no longer sign up for a GeoCities site. Free blog services probably fill the same need that GeoCities once filled. I admit that my first thought on this news was “they still exist?”. It’s a measure of the pace of today’s world that something started 15 years ago already seems so quaint.

The current business model for many of the social media sites is user generated content (read free), viewers not paying and unwilling to pay, and the business struggling to find advertising to cover their operational costs let alone make a profit. Given that Twitter is also not making money, how long will it be before the current favoured business model falls over?

Image video via pixabay